When the Internet revolution first began to alter the nature of global commerce, few foresaw how quickly traditional advertising would change with it. Year after year, online ads chipped away at the hegemony of print and media marketing. As markets and consumer demographics continued to fragment, the importance of laser-targeting ads to the right types of buyers became ever more critical. Nowadays, the fastest rates of e-commerce growth are seen in the local arena. In the coming year, you can expect to see online marketing dominate all other forms of local advertising for the first time in history.
The Raw Stats
According to respected research firm Borrell Associates
, online spending is projected to make up 25% of the total local advertising pie by the end of 2013. That's a 31% increase over 2012's numbers. Last year, $18.7 billion was spent on local online ads. In 2013, we can expect about $24.5 billion to be spent online in local markets. Local ad spending as a whole is predicted to rise 8.2% to $96.2 billion. According to Borrell Associates' 2013 Local Advertising Outlook
report, the future looks quite bright for local online advertising as preferred marketing methods diversify and become more sophisticated.
Who, What, When, Where and Why
The most powerful trends in the local online ad game in 2013 will be increased competition among advertisers and the increasing use of mobile ads across the board. The first trend means that big businesses as well as new entrants into the local ad game are more likely to shell out big bucks to attract local eyeballs on the web. Larger companies and corporate entities with deep pockets can afford to mount an all-out online marketing blitz in any niche market. Thanks to the rapid adoption of mobile technology, the second trend is a given. Regardless of cost per impression, mobile ads will only become more popular with businesses of all sizes.
Say Hello to SoLoMo
What's most interesting about these trends is how they're shaped by the non-stop innovation in the web application sphere. These days, the most effective way to maximize online ad ROI is through SoLoMo
. Short for Social, Local and Mobile, it's the convergence of social media, local advertising and mobile marketing to get the most out of ad spending. More and more, advertisers are going straight to the consumers on their mobile devices of choice. Using apps like Google Maps, Google+ Local, Foursquare and Field Trip, both local and global enterprises can target the consumers they value most highly and boost conversion rates.
Confronting the Inevitable
While the trends are clear, the best ways to take advantage of them aren't always so obvious. Just because a company has a massive marketing budget doesn't mean that it's necessarily getting the most from its advertising spending. Smaller businesses can still take advantage of and even dominate local advertising niches if they think outside the box. While international e-commerce is still dominated by the heavyweights, any local market is rife with opportunities for SMBs that can learn to adapt to the new local paradigm. A good deal of in-depth market research is ultimately the key to local online ad success.
Leverage Local or Die
For businesses operating at any level, the possibilities lurking in the local online ad game are enormous. Newspaper advertising revenues continue to wilt as readership numbers experience a steady decline, making most local print ads a waste of time and money. The future of local marketing will be web-based, and it's going to be increasingly reliant on location-based social networks
moving forward. The time to master local social media advertising is now, while you still have a fighting chance against larger businesses. Otherwise, you face the risk of falling behind in an ever more cutthroat environment.